DELHI DEVELOPMENT AUTHORITYversusBANKMENS CO-OPERATIVE GROUP HOUSING SOCIETY LTD. & ORS.

                            [2017] 6 S.C.R. 616



A                DELHIDEVELOPMENT AUTHORITY
                                     v.
           BANK.MENS CO-OPERATIVE GROUP HOUSING
                    SOCIETY LTD. & ORS.

B                      (Civil Appeal No. 6805 of2013)
                              APRIL 17,2017
                      [PINAKI CHANDRA GHOSE AND
                         DEEPAK GUPTA, JJ.]
            Co-operative Societies - Two Co-operative Housing Societies
c   (CGHS) 'B' and 'S' placed under liquidation for not complying with
    directions of Registrar of Co-operative Societies (RCS) - Revival
    applications for revival of both the societies filed by persons not
    concerned with the societies - List of members of 'B' approved for
    allotment of land by appellant-DDA - Though the land was allotted
D   provisionally by DDA but was not handed over to 'B ' - Writ petition
    by 'B' seeking direction to DDA to allot land to 'B ' - Writ allowed -
    LPA by DDA, disposed of directing verification of members either
    by DDA or RCS and thereafter possession of land be handed over
    to 'B' - Direction not complied with by DDA as 'B :S records were
E   with CBI in view of direction by High Court in relation to another
    CGHS wherein CBI stated that chargesheets have been filed against
    some office bearers of 'B' as well as 'S' - Another writ petition by
     'B 'praying for directions to DDA to handover possession of the
    plot pursuant to directions in aforesaid LPA - High Court directed
    DDA to process B :S case for allotment - Further, in case of 'S' also
F   land provisionally allotted but not handed over - Writ petition by
     'S', disposed of by High Court directing possession of allotted plot
    to 'S' - Plea of appellant that revival of societies was a fraudulent
    act and that the memberships of the societies were not genuine -
    On appeal, held: It is more than apparent that the builder mafia
G   was instrumental in getting the societies revived -After investigation
    by CBI, triable cases have been made out against the office bearers
    of both 'B' and 'S' and some officials of RCS - The move of revival
    of both the Societies was started by persons who were not even
    members or promoters of the original society- Thus, the very revival
    of the -Societies was illegal and the memberships are not genuine -
H
                                  616
  DELHI DEVELOPMENT AUTHORITY v. BANKMENS CO- .                      617
         OPERATIVE GROUP HOUSING SOCIETY

However, there may be some members of the Societies who have         A
been duped by the promoters - DDA directed to refund the money
deposited to the Societies along with interest @10% p.a w.e.f the
date when the money was deposited with the DDA - Societies in
turn to return the amount so deposited by the members along with
interest to obviate the hardships of genuine members.
                                                                     B
     Disposing of the appeals, the Court
      HELD: 1.1 It is more than apparent that the builder mafia
was instrumental in getting the societies revived. The CBI
conducted investigation on the directions of the High Court. After
investigation, triable cases have been made out against the office c
bearers of both 'B' and 'S' and some officials of the RCS. In case
of 'S', an inquiry was conducted on the directions given by the
High Court and in that inquiry it was found that the memberships
were not genuine. But that report has been brushed aside by the
High Court, only on the ground that this case was covered b.Y
case of another CGHS. The facts of these cases are totally D
different from the facts of the case relied on by the High Court.
(Para 15) (628-D-F]
      1.2 In the present case, the move for revival of both the
Societies was started by persons who were not even members or
promoters of the original society. There is nothing on record to E
show how these persons were entitled to file the application for
revival. The revival of societies was funded by the builders. The
original members have all vanished into thin air. There is no
explanation as to how they resigned and who accepted their
resignations. Both the Societies were put under liquidation F
because they could not furnish some information to the Office of
the RCS. There is not even a plea that when the revival was
done the RCS was satisfied that the reasons for which the
Societies were liquidated no longer existed. Therefore, the very
revival of the Societies is illegal and when the foundation falls
the edifice which has been developed on the foundation must G
go.(Para 16) [629-A-D]
     1.3 The revival of the Societies was illegal. It was
manipulated by persons who had no connection with the Societies.
The builder mafia had a big hand in getting the Societies revived.
                                                                     H
                                  '
618            SUPREME COURT REPORTS                        [2017] 6 S.C.R.


A     Hence, it is held that the very revival of the Societies is illegal
      and the memberships are not genuine. However, there may be
      some members of the Societies who must have been duped by
      the promoters. Therefore, DDA is directed to refund the money
      deposited to the Societies along with interest @10% p.a with
B     effect from the date when the money was deposited with the DDA.
      The amount be paid within 2 months from the date of the judgment.
      The Societies shall in turn ensure that within 4 weeks ther.eafter
      the amount deposited by the members is returned to them along
      with the interest aforesaid. This will alleviate the hardship of
      genuine members. [Para 19] [630-A-C]
C            Bhaurao Dagdu Paralkar v. State of Maharashtra
             (2005) 7 SCC 605 : [2005] 2 Suppl. SCR 774 - referred
             to.
                             Case Law Reference
      [2005] 2 Suppl. SCR 774          referred to            · Para 12
D
           CIVIL APPELLATE JURISDICTION: Civil Appeal No. 6805
      of2013.
            From the Judgment and Order dated 23 .07.2012 of the High Court
      of Delhi at New Delhi in W. P. (C) No. 3546 of2012

E                                     WITH
            C. A. Nos. 6803~6804 of2013
            C. A. Nos. 8627 of2014.
            Ranjit Kumar, SG., Ms. Binu Tamta, Md. Shahid Anwar, Rajat
      Aneja, Ms. Chandrika Gupta, K. N. Rai, Chirag M. ShroffAdvs. for the
      appearing parties.·
            The Judgment of the Court was delivered by
            DEEPAK GUPTA, J.
            C.A.NO. 6805 OF 2013 & C.A.NOS. 6803-6804 OF 2013
          These appeals are being disposed of by a common judgment since
      common issues of fact and law are involved.
             2. We may first refer to the facts of Civil Appeal No. 6805 of
      2013 relating to Bankmens Co-operative Group Housing Society
      (hereinafter referred to as the 'Bankmens CGHS'). Some employees
      of the State Bank of India resolved to form a Co-operative Group Housing
  DELHI DEVELOPMENT AUTHORITY v. BANKMENS CO- - 619
 OPERATIVE GROUP HOUSING SOCIETY[DEEPAK GUPTA, J.]

  Society, namely Bankmens CGHS Ltd., on 06.10.1983 under the A
  Chairmanship of one Deepak Khanna. The Society was registered with
  ~me Shri R.K. Mangla, as its Secretary. The Society had given a list of
  74 promoter members. Correspondence was exchanged between the
  Bankmens CGHS, Registrar of Co-operative Societies (hereinafter
  referred to as 'RCS') and the Delhi Development Authority (hereinafter B
  referred to as 'DDA'). The Bankmcns CGHS did not comply with
  various directions of the RCS and it was placed under liquidation on
  30.03.1992. Though Liquidator was appointed, he did not take over the
  records of the Bankmens CGHS.
          3. Some time between 1999-2000, almost after 16-17 years the
  Bankmens CGHS had been formed, and 7 years after. it was placed C
  under liquidation, an application for revival of the Society was filed by
  one Rajan Chopra. Admittedly he was not one of the original promoters
  of the Society. Though initially, objections were raised to the revival of
  the Society, the Society was finally revived on 13.07.2000. On 22.08.2000,
  a list of74 members of the Bankmens CGHS was approved for allotment D
  ofland and on 02.11.2001, the appellant DDA issued provisional Letter
· of Allotment ofland to the Society. Though the land was allotted yet the
  same was not handed over to the Society. Aggrieved by this, the
· Bankmens CGHS filed a Writ Petition No.1521 of2004 before the Delhi
  High Court in 2004 and on 31.05.2004, this petition was disposed of with
  a direction that land be provided to the Bankmens CGHS. Again,_st this, E
  the DDA filed an LPA No. 912 of 2004 which was disposed of on
  08.02.2006, directing that the verification of members be undertaken
  either by the DDA or by the RCS and, thereafter, possession of land be
  handed over to the Society within a period of two months subject to
  making payment as demanded by the DDA.                                     F
        4. The case of the appellant is that when it requested the RCS to
 verify the names of the members, the reply given was that all the records
 of the Bankmens CGHS were with the Central Bureau of Investigation
 (hereinafter referred to as the 'CBI') pursuant to the directions issued
 by the High Court of Delhi in Writ Petition No. 10066 of2004, filed by
 one Yogi Raj Krishna Bankmens Co-operative Group Housing Society            G
 Ltd. & Ors. Thereafter, DDA wrote to the CBI but tije CBI did not
 provide the record and replied that it was the duty of the RCS to verify
 the names of the members. In the year 2012, the Bankmens CGHS filed
 another Writ Petition No. 3546 of 2012 praying for directions to the
 DDA to handover the vacant possession of plot pursuant to the directions    H
620            SUPREME COURT REPORTS                           [2017] 6 S.C.R.



A     in LPANo.912 of2004 decided on 08.02.2006. The Writ Petition was
      disposed ofon 23.07.2012. The Delhi High Court directed the DDA to
      process the case of the Bankmens CGHS for possession of plot within a
      period of one month. This order is under challenge in Civil Appeal No.
      6805 of2013 @SLP (C) No.18747 of2013.
B           5. The facts of Safdarjung Co-operative Group Housing Society
    (hereinafter referred to as 'Safdarjung CGHS'), are similar. The
    Safdarjung CGHS was registered with the RCS on 18.11.1983. One
    Shri Sudarshan Tandon moved an application on 09.08.1983 for
    registration of the Safdarjung CGHS showing that it had 83 promoter
  · members. The Society wanted to change the names of its members but
C this action was not approved by the RCS and finally on 06.11.1990 an
    order was passed for liquidating the Safdarjung CGHS. Some of the
    records of the Safdarjung CGHS came into possession of one Mahanand
    Sharma who was not even a member of the Safdarjung CGHS. On
    01.12.1998, an application was moved by Mahanand Sharma for revival
D of the Safdarjung CGHS. Thereafter the Safdarj ung CGHS was revived
    on 26.04.1999. On24.ll .1999 the Office of the RCS recommended the
    name of Safdarjung CGHS for allotment ofland. After the Society was
    revived, like in the case of Bankmens CGHS, a plot of land was
    provisionally allotted to Safdarjung CGHS. Thereafter, Safdarjung CGHS
    filed a Writ Petition No.1990 of2004, which was disposed of along with
E the case ofBankmens CGHS (WP No. 1521 of2004). f\ggrieved by
    this order, an LPA No.904 of 2004 was filed by the DDA. in this case
    also and identical order was passed for verification of the members.
    Thereafter, similar correspondence took place between the DDA, Office
    of the RCS and the CBI.
 F            6. On 03.03.2011, Safdarjung CGHS filed a Writ Petition (C) No.
      13298 of2009 in the High Court of Delhi claiming that though it had paid
      the amount demanded to the DDA, the plot of land in Dhirpur had not
      been handed over on account of the CBI case pending against the office
      bearers of the Society. The High Court directed that the RCS should
 G    initiate fresh enquiry into the list of members submitted by the Safdarjung
      CGHS and it may also rely upon the investigation undertaken by the
      CBI. On 14.09.2011 enquiry report was submitted and it was found that
      the list of members was not authentic. Thereafter, the RCS on 10.01.2012
      passed an order that the names of the members of the respondent
      Safdarjung CGHS cannot be recommended to the DDA for allotment of
H     land.
 DELHI DEVELOPMENT AUTHORITY v. BANKMENS CO-                                    621
OPERATIVE GROUP HOUSING SOCIETY[DEEPAK GUPTA, J.]

       7. Aggrieved by the aforesaid order of the RCS on 28.01.2012, A
Safdarjung CGHS filed Writ Petition (C) No. 1168 of 2012 claiming that
the Society was a genuine Society and the Writ Petition was disposed of
on 27.02.2012 on the ground that the case of the Safdarjung CGHS was
identical to the case of Lords Cooperative Group Housing Society Vs.
Registrar, Cooperative Societies and Ors., which was disposed of on B
23.05.2011. The RCS was directed to take fresh decision in the matter.
Thereafter, on 02.05.2012, the RCS recommended the names of the
members of Safdarjung CGHS to the DDA. After the decision of the
High Court in Bankmens CGHS's case on 23.07.2012, the Safdarjung
CGHS filed Writ Petition (C) No. 5109 of2012 claiming relief of physical
possession of the allotted plot. The High Court disposed of the petition C
upon the statement of the counsel for DDA thatthe plot would be handed
over to the Society within a period 15 days. It is not disputed that
possession of this plot was actually handed over to the Safdarj ung CGHS
pursuant to this order. Both the order dated 27. 02.2012 passed in W.P.( C)
No.1168of2012 and order dated 22.08.2012 passed in W.P.(C) No.5109 D
of2012 have been challenged in C.A. Nos. 6803-6804 of2013@ SLP
(C) Nos. 3268-3269 of2013.
        8. Another important fact which is relevant for decision of these
cases is that the DDA had fixed a cut-off date of 31.10.2003 for allotment
ofland to the short-listed.societies. One Yogi Raj Krishna CGHS filed.a
Writ Petition No. 10066 of2004 alleging that a large number of bogus            E
societies which were either non-existent or defunct, or otherwise were
not eligible for allotment ofland had been included in the list of societies
after the cut-off date. In this Writ Petition a Division Bench of the Delhi
High Court in its order dated 25.08.2008 observed as follows:-
           "3. During the pendency of proceedings and on consideration          F
      of the material on record, it was felt that the matter required further
      probe and consideration on account of 'Builders' having taken
      over Cooperative Societies. It was observed in order dated
      22.11.2004, that societies were being sold and bought by builders
      in Delhi. Court expressed its deep concern over .the matter and           G
      called for Vice Chairman, DDA and Registrar of Cooperative
      Societies to be present in person in court. Pursuant to said order
      Mr. M. Gupta, Vice Chairman, DDA and Mr. S. Gopal Sharma,
      Registrar Cooperative Societies, appeared in person in court and
      they informed that authorities were aware that after allotment of
                                                                                H
622           SUPREME COURT REPORTS                            [2017] 6 S.C.R.



A        land to Cooperative Housing Societies in certain cases, the society
         as a whole is purchased by Builders and thereafter members are
         changed on the basis of en masse resignations, expulsions and
         new members inducted by charging premium at market rates,
         taking advantage ofloopholes in the Rules and Regulations. The
         Court observed the need for formulation of a comprehensive policy
 B
         with regard to allotment of land to Cooperative Societies taking
         into account the above factors. Union of India was also issued
         notice and has filed its affidavit. Learned Additional Solicitor
         General pointed out that an earnest attempt was being made to
         see that land allotted to societies was not hijacked by the builder
 c       mafia in Delhi and certain suggestions were placed on record.
               4. On 05.04.2005, DDA was directed to file an affidavit
         pertaining to the categorization of societies i.e. list of those societies
         which underwent liquidation and now were seeking revival and
         allotment of land and the list of genuine societies which had
 D       approved list of members till 31. l 0.2003, from _the office of
         Registrar Cooperative Societies, with their membership duly
         verified.
              5. Considering the enormous amount of money that had been
         pumped in and invested by the influential Builder mafia and other
 E       vested interests, collusion and complicity of the staff and officers
         of RC:S and others to hijack the societies, Director CBI was
         directed to constitute a special investigation team headed by an
         officer not below the rank of DIG with adequate staff to investigate
         the whole matter. On 31.08.2005, counsel appearing for CBI
         informed about outcome of preliminary investigation. CBI was
 F       directed to file a detailed affidavit in this regard. On 03. l 0.2005
         CBI filed status report wherein it pointed out that out of 135
         societies, 19 societies appeared to be genuine, the names of said
         societies had been given in Annexure A to the report. On the
         same date the names of those
      --~--                          '
                                         societies were ordered to be deleted
 G       from the list of 135 societies which were directed to be scanned
         by the CBI. Registrar Cooperative Societies was directed to verify
         the list of members in accordance with law.
             6. During the pendency of proceedings, this Court further
         noted that many societies had been allotted land after the year
         2000. It was noted that as the price of the land started soaring in
 H
 DELHI DEVELOPMENT AUTHORITY v. BANKMENS CO-                              623
OPERATIVE GROUP HOUSING SOCIETY[DEEPAK GUPTA, J.]

       Delhi after the year 2000, this spurt in land prices led to unholy A
       nexus between builders and powerful persons in various authorities.
       Societies which were hitherto defunct or had lost interest in
       allotment for one reason or another were sought to be revived by
       the office of the Registrar of Cooperative Societies and thereafter
       land was demanded from DDA on the basis of such
                                                                           B
       recommendation. The Court ordered DDA and Registrar of
       Cooperative Societies to give details of all the societies which
       were allotted land after the year 2000 and also directed them to
       produce the relevant files in court along with recommendations of
       allotment to DDA. CBI was directed to look into those allotments
       and also with regard to the members who had been allotted land. C
       Mr. K.C. Mittal, Advocate was appointedAmicus Curiae to assist
       the Court."
The High Court observed that since the builder mafia was very influential
and there was collusion between the builder mafia and officers of the
RCS, the investigation should be carried on by the CBI. The Director, D
CBI submitted his report pointing out that out of the 135 societies only
19 appeared to be genuine. The CBI both in the case of Bankmens
CGHS and Safdarjung CGHS filed chargesheet against some of the
office bearers of these two Societies and also officials of the RCS and
the RCS himself, alleging that tile Societies were revived in an illegal
manner.                                                                    E
        9. As far as Bankmens CGHS is concerned the charges are that
the revival application was filed by one Rajan Chopra by hatching ·a
criminal conspiracy along with officials ofRCS and Shri R.K. Srivastava,
Registrar of the RCS, to fabricate and manufacture false documents to
revive the Bankmens CGHS. The address of the Society was changed. F
It is also alleged that Rajan Chopra submitted a forged 'No Objection
Certificate' dated 29 .12.1999 purported to have been issued by Shri Vipin
Gandotra, Proprietor of Mis VG & Co., in this regard. Initially, when the
official of the RCS went to the address he found that no such Society
was existing at the address and, therefore, he recommended that the
Society should not be revived. However, another Dealing Assistant G
prepared a false note which was forwarded by other officials of the
RCS at the instance of the then RCS R.K. Srivastava and the Society
was revived. The case of the CBI is that though a fresh list of74 members
was given, not even one of these members was from the original list of
74 members when the Society was incorporated in the year 1983. The H
624            SUPREME COURT REPORTS                           [2017] 6 S.C.R.


A     case of the CBI further is that 35% of the cost of the land had to be paid
      by the Society to the appellant DDA. This money, according to the CBI ,
      was not paid by the enrolled members of the Society but a group of
      builders comprising of accused S.P. Saxena and Sandeep Sahni who
      had taken over control of the Society and paid a sum of Rs. 67,38,800/-
B     from their joint S.B. Account No. 18699 with the Central Bank of India,
      South Extension, Part-II, New Delhi Branch. Thus the case of the CBI
      is that this Society was illegally revived. It would be pertinent to mention
      here that after the filing of SLP (C) ... CC No. 2696 of 2013 (CA No.
      6805 of2013@ SLP (C) No. 18747/2013), this Court passed an order
      on 29.01.2013 directing the appellant DDA to file an additional affidavit.
 C    In this affidavit it has been mentioned that the Bankmens CGHS was
      registered at 21, Inder Enclave, Rohtak Road, New Delhi, with 65
      promoter members but on 31.07 .1985, Shri R.K. Mangla, requested the
      RCS to approve a list of74 members. Some issues were raised by the
      RCS but the Bankmens CGHS did not respond to the letter of the RCS
D     and, thereafter, the Society was placed under liquidation. When the
      accused Rajan Chopra filed an application for revival of the Society on
      11.11.1999 the address of the Society was changed to 4417-B, Regal
      Building, Connaught Place, New Delhi. The allegation is that the Society
      was revived fraudulently and that the names of the members of the
      Bankmens Society as in 1993 were never forwarded to the RCS at the
 E    time of revival of the Society and fresh members were inducted. Even
      the list of members pertaining to the year 1999 is totally different from
      the list of members as on 31.03.2003 and this list has been changed
      substantially on 31.03.2011. There were many resignations and new
      additions ofnew members. None of the original members of the Society
      whose names were listed in the list that was forwarded to the DDA on
 F    22.08.2000, feature in the list of members of the Bankmens Society as
      on 31.03.2011. The entire membership list is totally different. Even out
      of the list of 74 members as given on 31.03.2003 there are only 13
      members in the list of members as on 31.03.2011 and the other 61
      members were totally new.
 G           10. As far as the membership of Safdarjung CGHS is concerned,
      the facts are very similar. It would be pertinent to refer to the inquiry
      report in respect of this Society filed in the High Court ofDelhi in W.P.(C)
      No. 13298 of2009. In the enquiry report it was observed that the Society
      was initially formed on 18.11.1983 with 83 members. This Society was
 H    wound up in the year 1990 and as such there was virtually no society
 DELHI DEVELOPMENT AUTHORITY v. BANKMENS CO-                               625
OPERATIVE GROUP HOUSING SOCIETY[DEEPAK GUPTA, J.]

which could be revived. Be that as it may, the next list of members is of A
the year 1999. This list was submitted by one Mahanand Sharma. It ·
would be pertinent to mention that Mahanand Sharma was not a member
of the Society in 1983. According to this report as also as per the charge-
sheet submitted by the CBI Mahanand Sharma has, in fact, forged the
signatures of original members and has also forged the signatures of B
many members. During the inquiry by the CBI it was found that those
members who were shown to have resigned from the Safdarjung CGHS
had denied their signatures on the resignation letters. Therefore, the list
pertaining to the year 1999 itself was a forged and a fake list.
        11. In this case there is another list of members of the year 2009.
This list came to the knowledge of the authorities only when it was filed C
along with W.P.(C) No. 13298 of2009 and this list was not validated by
the RCS at any point of time. This list is not only different from the list of
1983 but also very different from the list of 1999. New members could
have been enrolled only after the resignation of old members but intimation
of resignation of a member has to be sent to the Office of RCS. The D
case of the CBI is that the resignations of most of the members are
forged. As pointed out above none of the members of the 1.983 list are
shown as members in the year 19~.?· In this case also the address of the
Society was changed from SDA Shopping Complex to Jagriti Enclave.
In this case when the Secretary of the so-called Safdarjung CGHS moved
the RCS for approval of the new list of members on 16.12.1999, a noting E
was made that the Secretary of the Society be asked to give all the
records relating to the resignations and enrollments. It was also noted
that the address of the Society was changed more than twice in a year.
No response was received from the Society and hence, according to
this report the membership list was totally fraudulent. Even with regard F
to the members shown in the list of 2009, the report found various
anomalies in the same. Therefore, the Registrar refused to accept the
list of2009 and refused to recommend the name of the Safdarjung CGHS
for allotment ofland. This order was challenged by the Safdarjung CGHS
by way of a writ petition and the High Court while disposing of the writ
petition held that this case was similar to the Writ Petition (C) No. 2441 G
of 2011, Lords Co-operative Group Housing Society vs. Registrar,
Cooperative Society and Ors. decided on 23.05.2011. It was argued
before the High Court that in the case of Lords CGHS the land had not
only been allotted but possession of the land had also been taken, flats
had also been constructed and they were ready for allotment. The High H
626            SUPREME COURT REPORTS                           [2017] 6 S.C.R.



A     Court rejected this plea on the following grounds:-
            " ...... We, however, find that the ratio of the said judgment is that
            where such societies had been permitted to be revived,
            contributions made by the members whether towards land or cost
            of flat, the matter should not be re-agitated. The verification had
B           to be carried out by the DDA atthe time of allotment ofland over
            which there is no dispute. The allotment is still subsisting. The
            impugned order 10.01.2012 does not even note this judgment
            delivered by us and proceeds on the basis as ifthe allotments are
            yet to be made. In fact the necessary recommendation has to be
            made to the DDA qua the eligible persons and not that the land
c           allotted to the society itself stand scrapped. The allotment ofland
            is a function of the DDA.... "
            This judgment is under challenge in W.P.No.13298 of2009.
            12. Shri Ranjit Kumar, learned Solicitor General appearing for the
D   DDA submits that the High Court fell in error in relying upon the judgment
    rendered in Lords CGHS case (supra). His submission is that the factual
    situation in that case was entirely different. In Lords CGHS case (supra)
     not only had the land been allotted, possession of the land had also been
     handed over to the Society, construction of the building was completed
     and the flats were ready. It was in these circumstances that the Delhi
 E High Court held that the members of the Society were entitled to get
     possession of the flats. No doubt, the decision of the Delhi High Court,
   · in Lords CGHS case (supra) was upheld by this Court but while upholding
     the judgment this Court observed that in view of the fact that construction
     was complete and flats were ready for allotment, the members of the
 F Society should not be denied possession of the same. Shri Ranjit Kumar
     has drawn our attention to the various orders passed by this Court in
     different cases and a bare perusal of these orders show that this Court
     did not go into the merits as to whether the Society could have been
     legally revived or not, but either disposed of the SLPs by a non-speaking
     order or rejected the same on the ground that construction was complete.
 G It is further urged by Shri Ranjit Kumar that the revival of the Societies
     was a fraudulent act and he submits that fraud vitiates all decisions and
     in this regard he made reference to the judgment of this Court in
     Bhaurao Dagdu Paralkar v. State of Maharashtra 1, relevant portions
     of which read as follows:-
 H    ' (2005) 7 sec 605
 DELHI DEVELOPMENT AUTHORITY v. BANKMENS CO- ·                                 627
OPERATNE GROUP HOUSING SOCIETY[DEEPAK GUPTA, J.]

          "9. By "fraud" is meant an intention to deceive; whether it is       A
      from any expectation of advantage to the party himself or from ill
      will towards the other is immaterial. The expression "fraud"
      involves two elements, deceit and injury to the person deceived.
      Injury is something other than economic loss, that is, deprivation
      of property, whether movable or immovable or of money and it
                                                                               B
      will include any harm what~ver caused to any person in body,
      mind, reputation or such others. In short, it is a non-economic or
      non-pecuniary loss. A benefit or advantage to the deceiver, will
      almost always cause loss or detriment to the deceived. Even in
      those rare cases where there is a benefit or advantage to the
      deceiver, but no corresponding loss to the deceived, the second          c
      condition is satisfied.
          10. A "fraud" is an act of deliberate deception with the design
      of securing something by taking unfair advantage of another. It is
      a deception in order to gain by another's loss. It is a cheating
      intended to get an advantage.                                            D
          11. "Fraud" as is well known vitiates every solemn act. Fraud
      and justice never dwell together. Fraud is a conduct either by
      letters or words, which induces the other person or authority to
      take a definite determinative stand as a response to the conduct
      of the former either by words or letters. It is also well settled that
      misrepresentation itself amounts to fraud. Indeed, innocent              E
      misrepresentation may also give reason to claim relief against
      fraud. A fraudulent misrepresentation is called deceit and consists
      in leading a man into damage by wilfully or recklessly causing him
      to believe and act on falsehood. It is a fraud in law if a party
      makes representations, which he knows to be false, and injury            F
      ensues therefrom although the motive from which the
      representations proceeded may not have been bad. An act of
      fraud on court is always viewed seriotisly. A collusion or conspiracy
      with a view to deprive the rights of others in relation to a property
      would render the transaction void ab initio. Fraud and deception
      are synonymous. Although in a given case a deception may not             G
      amount to fraud, fraud is anathema to all equitable principles and
      any affair tainted with fraud cannot be perpetuated or saved by
      the application of any equitable doctrine including res j udicata."
       13. We have heard learned counsel for the respondents and they
have also filed their written submissions. It would be pertinent to mention    H
              SUPREME COURT REPORTS                           [2017) 6 S.C.R.



A   that counsel for the respondents have not countered the submission of
    the learned Solicitor General that the revival ofthe Societies was illegal
    and fraudulent. The main submission is that the new members were
    validly granted membership in the Bankmens CGHS. They are not at
    fault and hence they should not be made to suffer. It is also urged that
B   the allegation that Rs.67,38,800/- was paid out of the funds of builders is
    incorrect and, in fact, this amount was paid out of the funds of the Society.
           14. In Safdarjung CGHS additional grounds have been taken that
    the DDA had not, in fact, challenged the orders dated 27.02.2012 and
    22.08.2012 but only after the land which was the subject matter of dispute
    in Bankmens CGHS case was illegally given to some third party, it was
C   felt by officials of the DDA that contempt proceedings may be initiated
    against them and, therefore, appeal was filed in Safdarjung CGHS case
    also. Again on merits all that has been stated is that after revival in the
    year 1999, the membership is genuine and bonafide and that the genuine
    members cannot be denied what is rightfully due to them.
D          15. We have carefully considered the arguments of both the sides.
    As pointed out by the Delhi High Court in Yogi Raj I\!:ishna CGHS's
    case (supra) it is more than apparent that the builder mafia was
    instrumental in getting the societies revived. The CBI conducted
    investigation on tlie directions of the Delhi High Court. After investigation
E   triable cases have been made out against the office bearers of both
    Bankmens CGHS and Safdarjung CGHS and some officials of the RCS.
    In Safdarjung CGHS 's case an inquiry was conducted on the directions
    given by the Delhi High Court and in that inquiry it was found that the
    memberships were not genuine. But that report has been brushed aside
    by the High Court, only on the ground that this case is covered by Lords
F   CGHS's case. We are in agreement with the learned Solicitor General
    that the facts of these cases are totally different from the facts of the
    Lords CGHS's case. In these cases even though provisional allotment
    was made more than 15 years back, yet the plot of land was never
    handed over to the Bankmens CGHS, and in the case of Safdarjung
G   CGHS possession ofland was handed over only after the intervention of
    the Delhi High Court in the year 2012 and the construction has not even
    started.· Therefore, these two cases stand on a totally different footing.
           16. As repeatedly held by this Court when an action is based on
    fraud the same cannot withstand the scrutiny of law. The revival of
H   these Societies is mired in controversy. When we talk ofrevival it would
 DELHI- DEVELOPMENT AUTHORITY v. BANK.MENS CO-                                   629
OPERATIVE GROUP HOUSING SOCIETY[DEEPAK GUPTA, J.)

normally mean that the society is being revived by its original members.         A
As far as these two cases are concerned the move for revival was
started by persons who were not even members or promoters of the
original society. The revival of societies was funded by the builders.
The original members have all vanished into thin air. There is no
explanation as to how they resigned and who accepted their resignations.         B
There is nothing on record to show how Rajan Chopra, in case of
Bankmens CGHS and Mahanand Sharma, in case of Safdarj ung CGHS
were entitled to file the application for revival. We also cannot lose sight
of the fact that both the Societies were put under liquidation because
they could not furnish some information to the Office of the RCS. There
is not even a plea that when the revival was done the RCS was satisfied          C
that the reasons for which the Societies were liquidated no longer existed.
It is also obvious that memberships kept changing and almost all the
members of these two Societies are persons who were granted
membership after the year 2003, i.e. after the cut-off date referred to in
Yogi Raj Krishna CGHS's case. We are, therefore, clearly of the view             D
that the very revival of the Societies is illegal and that when the foundation
falls the edifice which has been developed on the foundation must go.
       17. The argument made in Safdarjung CGHS 's case is that the
DDA had acquiesced to the orders passed by the Delhi High Court.
This argument is without merit. The delay in filing the petition was
condoned and now the respondents cannot be allowed to urge that the              E
appeal is not maintainable. We may make it clear that we have not gone
into certain arguments of the learned Solicitor General where he had
referred to the charge sheets in both the cases because we felt that we
should not make any comment that would have bearing on the criminal
trial. We further clarify that any observations made herein have been            F
made only with a view to decide these cases and will have no impact on
the criminal cases.
       18. Another argument raised is that verification of the members is
only to be done when the plots are to be allotted and such verification is
not required at the time when the land is to be allotted to the Society.
We are not at all in agreement with this submission. Ifthis submission is        G
accepted, in every case the DDA will be presented with afait accompli
and the situation as prevailing in Lords CGHS's case would come into
play. In a case like the present one where the very revival of the society
or the creation thereof is wholly illegal, verification of the members must
be done even at the stage before the land is allotted to the society.            H
630            SUPREME COURT REPORTS                          [2017] 6 S.C.R.


A           19. In view of the above discussion we are clearly of the view
    that the revival of the Societies was illegal. It was manipulated by persons
    who had no connection with the Societies. We are prima facie of the
    view that the builder mafia had a big hand in getting the Societies revived.
    Hence we hold that the very revival of the Societies is illegal and the
B memberships are not genuine and hence the appeals are allowed.
    However, there may be some members of the Societies who must have
    been duped by the promoters. Therefore, we direct the DDA to refund
    the money deposited to the Societies along with interest@! 0% p.a with
    effect from the date when the money was deposited with the DDA.
    The amount be paid within 2 months from today. The Societies shall in
C tum ensure that within 4 weeks thereafter the amount deposited by the
  · members is returned to them along with the interest aforesaid. This will
    alleviate the hardship of genuine members.
             20. Accordingly, Civil Appeal Nos. 6805of2013 and 6803-6804
      of 2013 filed by the DDA are allowed and the judgments/orders of the
D     Delhi High Court 23.07.2012, 27.02.2012 & 22.08.2012 are set aside
      and the Writ Petition (C) Nos. 3546, 1168 and 5109 of2012 filed by
      Bankmens CGHS and Safdarj ung CGHS are dismissed with the aforesaid
      terms.
      CIVIL APPEAL NO. 8627 OF 2014
E            21. This appeal is directed against the interim order of the Delhi
      High Court whereby the High Court directed that the membership of the
      Society be got verified. In view of what has been discussed above,
      there can be no ken of doubt that verification of the members must be
      done to ensure that the members of the society are genuine members.
 F    Hence Civil Appeal No. 8627 of2014 is dismissed.


      Divya Pandey                                             Appeals disposed of.